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I never really questioned this, but I've been wondering about it. At the end of the year you get interest paid forms from your bank(s) on any interest earned which is reported on taxes, but that doesn't show any kind of transactions.

Here's a practical application. A certain amount of primarily cash or cash-only workers don't report the income on their taxes (think waiters, strippers, anyone working for tips, etc), but the money does often end up in a banking institution via deposit. So if the IRS had access to bank account information (and the money was actually deposited and not directly spent), that could cause problems.

So the question is, does the IRS have access to bank information or not?

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This is also true between those three states. Perhaps, the reason for the unclaimed refund is because the people don't k... (more)

fedguy (Jun. 07, 2010 @ 7:24p) |

From 8300 has been used for quite a few years. As for Check21, I don't know much about that regulation. A local car de... (more)

fedguy (Jun. 07, 2010 @ 7:27p) |

I guess I shouldn't have mentioned South Dakota in the earlier question. I was only using that state as an example of o... (more)

fedguy (Jun. 07, 2010 @ 7:29p) |

Are your bases are belonged to IRS
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lol

I know a bartender who got audited but her husband worked in the same industry...probably raised some flags?

be afraid, be very afraid

If you get a 1099-INT, we have your account number.

No they don't have access to your bank info prior to an examination but may ask for it if you can't show documentation of enough income to support your lifestyle...

Of course they don't, unless they audit you and ask for it.

If they did, then the millions of people employed by thousands of banks that would be involved in transmission of this information would have widely disclosed this fact by now.

They do not have access to deposit information. If you come up for (field) audit, they will ask you for all bank statements (if you have schedule C or E) and usually summon them if you are unable to provide them. By law, you are required to receive notice by certified letter if the IRS does this. It is then on you to explain deposits that are not income.

The IRS has all your email, facebook, and twitter passwords. They know everything about you.

There is a law which states that banks can not be sued for providing their customer's financial information to the IRS upon their request.

tripleB said: The IRS has all your email, facebook, and twitter passwords. They know everything about you.

Not me. The Pain Monster has all of my passwords.

What's the IRS?

Pic, if you are a stripper.

All your base belong to us .....

This thread needs a lolcat.


Take the example of a street vendor. Someone from the "underground economy". Many of these type of workers "hide" income and it is hard to track it since only they will report that they made any money. That is why these people don't put their money in banks. They keep it to themselves (like under a mattress). That is why those that deal with "money laundering" try to make this untaxed money moved to legitimate financial institutions. With the imposition of the Patriot Act, moving sums of money is going to be scrutinized more. So regular "tax avoiders" could be snagged along with those that fund terrorism.

But to go back to your question, does the IRS have access to bank information? For processing your tax return, the answer is no (with regards to balances, deposits, withdrawals, bill payments, EFTs, etc.). However, should you be subject to a micro-examination audit, they can issue requests to get financial information about your previous spending habits and account balance histories.

By the way, the largest percentage of unclaimed tax refund money are in the states of California, Texas, and Florida. States like South Dakota have very little unclaimed refund money. Now what do these three states have in common?

Just an FYI, if you deposit 5k or more they may report it to the IRS. If it is 10k or more, the WILL report it.

Unless the rules have changed.

You must be referring to Form 8300 (Currency Transaction Report).
http://www.irs.gov/businesses/small/article/0,,id=148821,00.html

fedguy said: Take the example of a street vendor. Someone from the "underground economy". Many of these type of workers "hide" income and it is hard to track it since only they will report that they made any money. That is why these people don't put their money in banks. They keep it to themselves (like under a mattress). That is why those that deal with "money laundering" try to make this untaxed money moved to legitimate financial institutions. With the imposition of the Patriot Act, moving sums of money is going to be scrutinized more. So regular "tax avoiders" could be snagged along with those that fund terrorism.

But to go back to your question, does the IRS have access to bank information? For processing your tax return, the answer is no (with regards to balances, deposits, withdrawals, bill payments, EFTs, etc.). However, should you be subject to a micro-examination audit, they can issue requests to get financial information about your previous spending habits and account balance histories.

By the way, the largest percentage of unclaimed tax refund money are in the states of California, Texas, and Florida. States like South Dakota have very little unclaimed refund money. Now what do these three states have in common?


Raises hand, squirming in my seat, hoping to be called on first ....

"illegal immigrants"

Do i get an "A"?

Nope, correct answer is "sunshine."

Or, maybe: "oil."

Yeah, I know, Florida doesn't have that much oil, YET. But, it is on the way, courtesy of BP.

fedguy said: You must be referring to Form 8300 (Currency Transaction Report).
http://www.irs.gov/businesses/small/article/0,,id=148821,00.html
No it was something else. Any non business depositing 5k-10k was reported to the manager who had to fill out a form (as well as the check being placed on hold).

This was all before Check21 came out and I don't know if Check21 changed those rules but personal people depositing large checks were reported.

fedguy said: Take the example of a street vendor. Someone from the "underground economy". Many of these type of workers "hide" income and it is hard to track it since only they will report that they made any money. That is why these people don't put their money in banks. They keep it to themselves (like under a mattress). That is why those that deal with "money laundering" try to make this untaxed money moved to legitimate financial institutions. With the imposition of the Patriot Act, moving sums of money is going to be scrutinized more. So regular "tax avoiders" could be snagged along with those that fund terrorism.

But to go back to your question, does the IRS have access to bank information? For processing your tax return, the answer is no (with regards to balances, deposits, withdrawals, bill payments, EFTs, etc.). However, should you be subject to a micro-examination audit, they can issue requests to get financial information about your previous spending habits and account balance histories.

By the way, the largest percentage of unclaimed tax refund money are in the states of California (1), Texas (2), and Florida (3). States like South Dakota (4) have very little unclaimed refund money. Now what do these three states have in common?


um, 4 states?

fedguy said:

By the way, the largest percentage of unclaimed tax refund money are in the states of California (1), Texas (2), and Florida (3). Now what do these three states have in common?


States like South Dakota have very little unclaimed refund money.

Technologist: Restructured, you can more easily see that SD is not part of the other 3

It's one of those "find the one that doesn't belong" questions.

owenscott said: fedguy said: Take the example of a street vendor. Someone from the "underground economy". Many of these type of workers "hide" income and it is hard to track it since only they will report that they made any money. That is why these people don't put their money in banks. They keep it to themselves (like under a mattress). That is why those that deal with "money laundering" try to make this untaxed money moved to legitimate financial institutions. With the imposition of the Patriot Act, moving sums of money is going to be scrutinized more. So regular "tax avoiders" could be snagged along with those that fund terrorism.

But to go back to your question, does the IRS have access to bank information? For processing your tax return, the answer is no (with regards to balances, deposits, withdrawals, bill payments, EFTs, etc.). However, should you be subject to a micro-examination audit, they can issue requests to get financial information about your previous spending habits and account balance histories.

By the way, the largest percentage of unclaimed tax refund money are in the states of California, Texas, and Florida. States like South Dakota have very little unclaimed refund money. Now what do these three states have in common?


Raises hand, squirming in my seat, hoping to be called on first ....

"illegal immigrants"

Do i get an "A"?


Your answer is a plausible one. The number of illegals is higher in those three states (given their proximity to Latin America). The refund figures only report total amounts (those that were going to go back to the US Treasury because the three year filing deadline had just expired) and not number of taxpayers. Since the SSNs are not reported, you cannot verify the taxpayer profile of who isn't claming the money. But if I was an illegal, I sure wouldn't want to "broadcast" my income and address to the authorities, even to get some free money.

MrKlick said: Nope, correct answer is "sunshine."

Or, maybe: "oil."

Yeah, I know, Florida doesn't have that much oil, YET. But, it is on the way, courtesy of BP.


This is also true between those three states. Perhaps, the reason for the unclaimed refund is because the people don't know how to fill out the form?

forbin4040 said: fedguy said: You must be referring to Form 8300 (Currency Transaction Report).
http://www.irs.gov/businesses/small/article/0,,id=148821,00.html
No it was something else. Any non business depositing 5k-10k was reported to the manager who had to fill out a form (as well as the check being placed on hold).

This was all before Check21 came out and I don't know if Check21 changed those rules but personal people depositing large checks were reported.


From 8300 has been used for quite a few years. As for Check21, I don't know much about that regulation. A local car dealership got fined for not reporting cash transactions for car purchases. The dealership shut down, but not sure if it was due to this problem.

ellory said: fedguy said:

By the way, the largest percentage of unclaimed tax refund money are in the states of California (1), Texas (2), and Florida (3). Now what do these three states have in common?


States like South Dakota have very little unclaimed refund money.

Technologist: Restructured, you can more easily see that SD is not part of the other 3


I guess I shouldn't have mentioned South Dakota in the earlier question. I was only using that state as an example of one from the bottom of the refund money list.



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